BRICS countries to hold talks with South American leaders

BRASILIA, Brazil -- Leaders of the BRICS group of emerging powers hold a summit Wednesday with South American presidents, bringing together nations seeking alternatives to U.S. influence in the region.

The leaders of Brazil, Russia, India, China and South Africa will hold talks in the Brazilian capital with counterparts from Argentina, Chile, Colombia, Ecuador, Venezuela and other Latin American nations.

The gathering follows a BRICS-only summit Monday in the northeastern seaside city of Fortaleza, where the five nations agreed to create a development bank and a crisis reserve fund seen as rivals to Western-dominated financial institutions.

Now Brazilian President Dilma Rousseff will host her BRICS counterparts and her allies in South America for a day of talks in the capital.

“It's an opportunity for Brazil to show that it's not just interested in the BRICS but that it is betting on integration and what benefits the region,” said Oliver Stuenkel, foreign relations professor at the Getulio Vargas Foundation.

For Chinese President Xi Jinping, the meetings represent a new push by Beijing to gain clout in a region traditionally seen as a U.S. backyard.

After Wednesday's talks, Xi will spend one more day in Brazil to launch a China-Latin America forum with leftist leaders including Cuban President Raul Castro.

China-LatAm Trade Rising

China's massive purchases of commodities and exports of manufactured goods to the resource-rich region have boosted its two-way trade with Latin America to a total of US$261.6 billion last year.

The meetings are also another opportunity for India's new Hindu nationalist Prime Minister Narendra Modi to present himself to the world.

For Russian President Vladimir Putin, the talks give him a platform following his country's exclusion from the G8 group of industrialized nations over Moscow's annexation of Crimea from Ukraine.

The BRICS leaders will be joined in Brasilia by leftist firebrands including Venezuelan President Nicolas Maduro, Argentine President Cristina Kirchner and Ecuadoran President Rafael Correa.

The new financial mechanisms created by the BRICS could benefit Argentina, which is at risk of defaulting on US$1.3 billion in debts after losing a U.S. Supreme Court battle with hedge funds seen as “vultures” by Buenos Aires.

The New Development Bank, to be based in Shanghai, will have capital of US$50 billion that could rise to US$100 billion to fund infrastructure projects, while the fund will have US$100 billion at its disposal to weather economic storms.

But it could take two years, however, for the institutions to be operational because they have to ratified by the legislatures of each BRICS nation.

Rousseff left open the possibility of using the fund to help non-BRICS nations, saying the group would be willing to “examine” any request from Argentina.

“We are open to see what relationship (the fund) could have with countries outside the BRICS group but it hasn't been decided yet because we just formed this institution,” she said after Tuesday's summit.

“If Argentina will benefit or not is something that we will have to examine ... (but) first Argentina must make a request,” she said. “Our view is that we would be generous to developing countries.

Leaders of the BRICS nations, from left, Russia's President Vladimir Putin, India's Prime Minister Narendra Modi, Brazil's President Dilma Rousseff, China's President Xi Jinping and South Africa's President Jacob Zuma, pose for a group photo during the BRICS summit in Fortaleza, Brazil, Tuesday, July 15. (AP)